Wachovia’s Board Approves Wells Fargo Merger Proposal

CHARLOTTE, N.C. – In a complete 180, Wachovia’s board last night approved a deal to sell the bank to Wells Fargo.

Wachovia had been negotiating with Citigroup to complete a transaction supervised by the FDIC that included assistance from the government. Under the Wells Fargo proposal, each share of Wachovia common stock will be exchanged for 0.1991 shares of Wells Fargo common stock, representing a value of $7 per share, based on Wells Fargo’s closing stock price on Oct. 2.

“We at Wachovia have great admiration and respect for the people and businesses at Wells Fargo and we are extremely pleased to join forces with this outstanding company,” said Robert K. Steel, President and CEO of Wachovia. “Today’s announcement creates one of the strongest financial firms in the world and is great for all Wachovia constituencies: our shareholders, customers, colleagues and communities. This deal enables us to keep Wachovia intact and preserve the value of an integrated company, without government support. The market presence and composition of our businesses, along with our service-oriented cultures, are extraordinarily complementary and this combination creates great potential for sustained stability and growth.”

Wells Fargo and Wachovia will have the largest deposit base in the country, creating a coast-to-coast banking franchise for consumers, Wachovia said in a news release. In addition, Wachovia will combine with the only AAA-rated financial institution in the United States.